hebel. today · 2 November 202629 / 69
Money · Market Analysis
Trend persistence outweighs single-day market bounces
Market participants often mistake short-term price movements for structural shifts. A single day of gains in indices like the QQQ does not alter the underlying trend, especially while prices remain below key declining moving…
From 7 newsletters · 1 min read · one thing to try
Market participants often mistake short-term price movements for structural shifts. A single day of gains in indices like the QQQ does not alter the underlying trend, especially while prices remain below key declining moving averages (The Smart Stocks Newsletter). Relying on fundamentals to explain these discrepancies frequently fails, as narratives often emerge only after the market has already moved in the opposite direction (I-System TrendCompass). Instead of searching for meaning in daily volatility, successful strategies prioritize technical structures and price action to identify where liquidity is truly flowing (Global Trading Show, Global Trading Show).
“The advantage comes from understanding how these elements interact — and knowing when a strategy needs to evolve.”
Global Trading Show
Current market regimes show a distinct divergence across sectors. Large-cap equities and crypto maintain long-term uptrends, yet short-term momentum is cooling across these assets (My Weekly Stock, AIP Research). Small caps and precious metals have suffered more significant damage, breaking below their 30-week exponential moving averages (My Weekly Stock). This deterioration in breadth and momentum serves as a warning, prompting many professional managers to raise cash levels while waiting for a clearer resolution in the bond and oil markets (My Weekly Stock, Annualize This).
Effective investment requires a disciplined framework that separates tradable momentum from market noise. This involves monitoring exponential moving averages to assess trend quality and using support and resistance levels to define risk management zones (SmartReversals’ Trading Compass). Because algorithms drive over 70% of daily market volume, these technical levels often dictate price action more reliably than fundamental analysis. By focusing on relative strength rather than chasing lagging indicators, you can better align your positions with the dominant market cycle.
Try today · 20 min
Build a technical trend monitor for your current watch list.
Use a spreadsheet to track the 30-week exponential moving average for each ticker to confirm if the primary trend remains intact.
You need
- Ticker list of current investments
- Spreadsheet software
- Access to weekly price data
Steps
- List all your current holdings in a spreadsheet.
- Calculate the 30-week exponential moving average for each asset.
- Compare the current price to the calculated average.
- Identify which assets have broken below this level.
- Review your position size for any asset that has broken its trend.